Apple’s falling iPhone sales not a problem as margins, buybacks grow [Video]

A 10% decline in iPhone sales sounds like a problem for Apple, considering the company counts on the devices for half its revenue.

But investors didn’t seem to mind on Thursday, when Apple revealed the year-over-year drop in its fiscal second-quarter earnings report. The stock rose more than 6% after the market close, a rally that would be the steepest since November 2022 should it continue into regular trading on Friday.

Instead of glaring too much at iPhone revenue, Wall Street chose to focus on the positive. Apple’s gross margin expanded to 46.6%, continuing an upward trajectory that reflects the company’s growing services business, which brings with it stout profits.

Apple also signaled overall revenue growth in the current quarter will be in the low-single digits, following a 4% decline in the second period. Analysts were looking for third-quarter growth of 1.3%, according to LSEG.

Deepwater Asset Management’s Gene Munster described …